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Article
Publication date: 1 December 2021

Oskar Jost

Assess and compare scarring effects of unemployment in Germany to other countries and to consider firm heterogeneity.

Abstract

Purpose

Assess and compare scarring effects of unemployment in Germany to other countries and to consider firm heterogeneity.

Design/methodology/approach

The author uses linked employer-employee data to analyze the effect of unemployment and its duration on future wages in Germany. Using administrative data on workers and firms in Germany and considering registered and unregistered unemployment episodes, the results show long-lasting wage losses caused by unemployment incidences. Furthermore, the estimations indicate that unemployment duration as well as selectivity into firms paying lower wages is of particular relevance for the explanation of wage penalties of re-employed workers.

Findings

Unemployment causes massive and persistent wage declines in the future, which depend on the unemployment duration. Furthermore, reduced options of unemployed workers and selectivity in firms contribute to a large part of unemployment scarring.

Practical implications

Findings are relevant for current debates on unemployment and can help design measures to avoid huge costs of unemployment.

Originality/value

This paper analyses long-term unemployment scarring by considering not only unemployment duration but also selectivity in firms and its effect on the scarring effect.

Details

International Journal of Manpower, vol. 43 no. 5
Type: Research Article
ISSN: 0143-7720

Keywords

Article
Publication date: 7 February 2023

Begona Eguia, Carlos Rodriguez Gonzalez and Felipe Serrano

The authors’ goal in this paper is to study if there are long-run effects on the wages of those workers who entered the labour market overeducated but who have, over time, been…

Abstract

Purpose

The authors’ goal in this paper is to study if there are long-run effects on the wages of those workers who entered the labour market overeducated but who have, over time, been able to overcome this situation by obtaining a job for which they are correctly matched.

Design/methodology/approach

This study universe is constituted by workers entering the labour market with a university degree between 2004 and 2012. The age range of these individuals is between 22 and 35 years old. With the data of the 8,359 selected individuals, the authors have constructed a balanced panel covering the period 2013–2017. This methodology is developed in two steps. First, the authors estimate a wage equation with the traditional variables and, second, the authors use the estimated coefficients of these variables to predict the wage paths of a representative individual in each group.

Findings

The main result the authors obtain indicates that the wages of those who manage to overcome an initial situation of overeducation do converge but very slowly to the respective wages of those others that entered the labour market correctly matched from the beginning. The authors consider this result to point towards the existence of scarring effects in wages induced by an initial situation of overeducation. The authors also present evidence, beyond education, about the influence that the occupational characteristics that a worker has on wages.

Research limitations/implications

The factors that can influence the catching-up of wages are multiple, and it is not feasible to test all of them empirically. Therefore, the wage convergence process the authors present may also be influenced by other variables for which the authors do not have information.

Practical implications

This paper contributes to different branches of the labour market. First, the authors present new evidence within the literature dealing with the so-called scarring effects on wages related to the conditions entering the labour market. Secondly, this study’s results provide a new argument that complements those developed so far that explain a reduction in the wage skill premium detected among young graduates in Spain. Finally, this paper contributes to advancing research about the effects that overeducation has on wages.

Originality/value

The question the authors are attempting to answer in this paper can be formulated in the following terms: when a worker manages to overcome an initial situation of overeducation, what happens to his/her wage? Will it adjust quickly to the new working situation, or will we observe a slow convergence to the wages of workers with an employment history without overeducation situations? To the best of the authors’ knowledge, this topic has not yet been studied. Researchers have mostly focused their attention on comparing the wages of overeducated workers with the wages of those who are correctly matched. In this case, the authors compare the wages of correctly matched workers, but with the difference that some were initially overeducated and others were not.

Details

International Journal of Manpower, vol. 44 no. 4
Type: Research Article
ISSN: 0143-7720

Keywords

Article
Publication date: 8 May 2018

Fredrik W. Andersson, Susanne Gullberg Brännstrom and Roger Mörtvik

It is increasingly important to study labour market outcomes for people who are not in employment, education, or training (NEET). Where most studies focus solely on young people…

Abstract

Purpose

It is increasingly important to study labour market outcomes for people who are not in employment, education, or training (NEET). Where most studies focus solely on young people, the purpose of this paper is to include both younger and older NEETs to find out if there is any long-term scarring effect, and if the effect is different between these two groups.

Design/methodology/approach

This study uses a twin-based estimation method for the first time to measure the long-term effect of economic inactivity on income. The analysis is based on biological twins, in order to control for individuals’ unobservable heterogeneity. It is assumed that twins are similar to each other and the only unobservable heterogeneity is at the family level. Register-based data from Statistics Sweden is used.

Findings

The result indicates a significant negative income effect for those who have been in NEET, and is larger for those who have been in NEET for several consecutive periods of time. Individuals who were in NEET during 2001-2003 had on average 62 per cent lower income compared with their twin in 2011. The corresponding number for individuals who were in NEET for just one period was 33 per cent. Hence, time in NEET reduces income. The results show that the long-term scarring effect is not affected by age.

Originality/value

This study utilises for the first time a twin-based estimation method to measure the long-term effect of inactivity. Most studies focus solely on young people, but the authors also include an older group of people.

Details

International Journal of Manpower, vol. 39 no. 2
Type: Research Article
ISSN: 0143-7720

Keywords

Article
Publication date: 22 May 2023

Emanuela Ghignoni and Francesco Pastore

After the decision of the Egyptian government to adhere to the Equal Pay International Coalition in 2020, a great deal needs to be done to guarantee ‘equal pay for equal work’…

Abstract

Purpose

After the decision of the Egyptian government to adhere to the Equal Pay International Coalition in 2020, a great deal needs to be done to guarantee ‘equal pay for equal work’. The authors provide a comprehensive, in-depth, up-to-date analysis of the gender wage gap in Egypt, as well as its evolution over the last 20 years, disaggregated by public and private sector. The authors also provide an analysis of the cultural determinants of Egypt's low female participation.

Design/methodology/approach

The authors apply the Oaxaca-Blinder decomposition (with sample selection) to assess the gender wage gap at the mean of the wage distribution in the public and private sector. The authors also implement a re-centred influence function decomposition to assess the extent of ‘discrimination’ along the wage distribution in both sectors. An inverse-probability-weighted regression adjustment procedure is used to assess the joint impact of gender and firm-ownership. A female participation equation taking into account gender equality attitude is provided.

Findings

The authors find a sizable and increasing gender wage gap in the private sector almost entirely due to ‘discrimination’. The authors also find evidence of a sticky floor in the private sector and a glass ceiling in the public one. Cultural barriers play a major role in determining female participation.

Originality/value

This is the first paper on the evolution of gender equality in Egypt that takes into account the effect of the 'Arab Spring’ of 2011. To the best of the authors’ knowledge, this is also the first time that an IPWRA procedure is applied to study the interaction effect of gender and firm-ownership.

Details

International Journal of Manpower, vol. 44 no. 8
Type: Research Article
ISSN: 0143-7720

Keywords

Article
Publication date: 18 October 2022

Alisha Ralph and Akarsh Arora

This study aims to investigate the global issues of youth unemployment using bibliometric analysis covering the period from 1983 to 2022. There is a dearth of a bibliometric study…

Abstract

Purpose

This study aims to investigate the global issues of youth unemployment using bibliometric analysis covering the period from 1983 to 2022. There is a dearth of a bibliometric study analysis on unemployment, particularly youth unemployment even at the global level. The present study seeks to fill this gap by exploring the prominent studies related to youth unemployment at the global level.

Design/methodology/approach

Using VOSviewer software bibliometric results and the Scopus database, the study uncovered the most frequently cited, prominent and influential authors, as well as the institutions that have worked on youth unemployment and the most prominent keywords published on youth unemployment.

Findings

Nearly 80% of the research articles on youth unemployment were published from 2005 to 2022, and a significant increase in publication after 2012 is observed. Based on the published papers, the most studied determinants of youth unemployment are increased levels of regional economic advances, state demographics, relocation, household conditions, regional openness and export/import. Economic freedom, labour market reforms, economic growth, high proportion of part-time employment, active labour market policies, minimum wage norms, extent of bargaining scope and alignment are prominent determinants that reduce unemployment at large and improve labour market performance of youth in particular.

Research limitations/implications

Bibliometric analysis, like the present study, can narrow down the most prominent sources of information on youth unemployment for beginners in this field of research.

Practical implications

This bibliometric study on youth employment assists researchers and policymakers in understanding and summarizing the necessary determinants of youth employment that are already being identified and studied based on practical evidence from the authors’ case study-based research work. The present study raises the issue of youth unemployment at large. It helps in identifying factors in one place and thus new researchers can use it as a starting point for their research on youth unemployment. It helps in providing clustering of factors. It highlighted the significant studies, authors and institutions working in this field.

Social implications

On social implication, it can be argued that studies on topics related to human resources have a direct impact on society standards. By producing scientific knowledge that aids in the recognition of the complexities of human processes and behaviours, social science research significantly contributes to the enrichment of the community as a whole. When young people are unemployed, it causes social unrest and may increase crime and terrorism, all of which contribute to political instability. Youth unemployment causes psychological illness because of anxiety, alienation and depression. As a result, it causes social instability and necessitates immediate attention in all societies. The present study highlights that although the unemployment rate of youth is significantly higher in underdeveloped countries than the developed countries, their representation in the publication is significantly low. This under-representation of countries shows their lack of commitment to society in working on the issue of youth unemployment.

Originality/value

It is assumed that there are plenty of research studies on unemployment, particularly at the global level. However, various domains of researchers may require a bibliometric kind of analysis wherein they may get an idea about the prominent number of literatures arguing concerning issues at large, in the sense of “focused studies” covering the comprehensive viewpoint on youth unemployment. The paper aimed to emphasize the topic of youth unemployment, its development in the research field and the usefulness of bibliometric analysis in social sciences in general, and youth unemployment in particular.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 17 no. 6
Type: Research Article
ISSN: 1750-6204

Keywords

Article
Publication date: 3 September 2018

Marjan Petreski

The purpose of this paper is to investigate if public provision of employment support services to youth leads to reduced informality and increased wages in transition economies.

Abstract

Purpose

The purpose of this paper is to investigate if public provision of employment support services to youth leads to reduced informality and increased wages in transition economies.

Design/methodology/approach

The author uses the school-to-work transition data sets of the International Labor Organization for seven transition economies of Southeast Europe and the Commonwealth of Independent States. The author focuses on two econometric issues: the selectivity into informal employment and the endogeneity of the public employment support service provision with respect to informal employment and wages. The authors achieves identification by employing internal regressors which are uncorrelated with the product of heteroskedastic errors, a-la Lewbel (2012), as the author could not prove the external validity of the commonly used external instruments in similar contexts.

Findings

Results suggest that the public provision of employment support services matters for relegating informal employment, but not for wages, in general. Placement in education or training programs is most powerful in reducing informal employment among the four different employment support services, while only advice for job search works positively for wages probably through enabling better match.

Social implications

Increasing budget allocations, varying the array of public employment support measures, enhanced targeting, and advancement of the profiling system may significantly contribute to strengthening the public employment support service effect on youth employment in transition economies.

Originality/value

The paper brings a couple of novelties to the current literature. First, it is among the early papers dealing with the issue of informality, public employment support service and labor market prospects of youth in general in a rigorous manner. Second, it fills an important gap for transition economies which were less researched due to the long-lasting transition process as well due to data scarcity. Third, it utilizes the recently collected School-to-Work Transition Surveys (SWTS). Finally, and likely most importantly, it thoroughly addresses the issues of selectivity bias and endogeneity of PESS by utilizing a recent approach of Lewbel (2012) whereby internally generated variables are used as instruments. Hence, the paper accounts for the endogeneity stemming from unobservables in a novel manner, contrary to the common approaches in the literature based either on propensity score matching addressing selectivity on observables only, or relying on commonly used instruments in the labor market literature – mainly regional employment variables – whose external validity is easily disputed.

Details

International Journal of Manpower, vol. 39 no. 6
Type: Research Article
ISSN: 0143-7720

Keywords

Expert briefing
Publication date: 21 June 2016

Prospects for the Russian economy to end-2016.

Article
Publication date: 16 July 2019

Benedikt Gerst and Christian Grund

Career interruptions of employees imply important issues for both firms and individuals, including a possibly lower compensation after returning to a job. Different compensation…

Abstract

Purpose

Career interruptions of employees imply important issues for both firms and individuals, including a possibly lower compensation after returning to a job. Different compensation components are explored, as bonus payments frequently complement fixed salaries for many employees, making various channels of lower compensation possible. This paper aims to discuss this issue.

Design/methodology/approach

This study is based on a yearly salary survey among a rather homogeneous group of professionals and middle managers from the German chemical sector, which contains detailed information on compensation components next to individual and job characteristics. The incidence and duration of past career interruptions act as the most important independent variables. Mincer-type wage regressions are complemented by estimations on wage increases.

Findings

The results show that career interruptions are more related to lower subsequent bonus payments than they are to fixed salaries. Furthermore, interruptions caused by unemployment are associated with higher interruption pay gaps than those resulting from other reasons such as parental leave. The results even hint for catch-up effects following parental leave with regard to higher wage increases compared to individuals without interruptions. Career interruptions are more prevalent for female managers offering an explanation for a considerable part of gender pay gaps. Wage losses after career interruptions are more pronounced for male employees than they are for females, though.

Originality/value

This study extents the literature by disentangling the relation of career interruptions and different compensation components, bonus payments next to fixed salaries in particular. The role of interruption type and gender are also taken into account so that the paper deepens the understanding of the role of past career interruptions for employees’ remuneration.

Details

International Journal of Manpower, vol. 40 no. 5
Type: Research Article
ISSN: 0143-7720

Keywords

Book part
Publication date: 7 October 2019

Charlotte McPherson

Young people are widely known to have poorer outcomes, social status and political representation than older adults. These disadvantages, which have come to be largely normalized…

Abstract

Young people are widely known to have poorer outcomes, social status and political representation than older adults. These disadvantages, which have come to be largely normalized in the contemporary context, can be further compounded by other factors, however, and are particularly amplified by coming from a lower social class background. An additional challenge for young people is associated with place, with youth who live in more remote and less urban areas at a higher risk of being socially excluded (Alston & Kent, 2009; Shucksmith, 2004) and/or to face complex and multiple barriers to employment and education than their urban-dwelling peers (Cartmel & Furlong, 2000). Drawing upon interviews and focus groups in a qualitative project with 16 young people and five practitioners, and using Nancy Fraser’s tripartite theory of social justice, this paper highlights the various and interlocking disadvantages experienced by working-class young people moving into and through adulthood in Clackmannanshire, mainland Scotland’s smallest council area.

Details

Human Rights for Children and Youth
Type: Book
ISBN: 978-1-78973-047-0

Keywords

Article
Publication date: 5 August 2019

Sonia Bertolini and Valentina Goglio

The purpose of this paper is to analyse whether and to what extent the labour market situation of young Italians affects their chances of exiting the parental home…

Abstract

Purpose

The purpose of this paper is to analyse whether and to what extent the labour market situation of young Italians affects their chances of exiting the parental home, differentiating between leaving parental home with or without a partner. The paper also considers whether contextual factors, such as the occurrence of the economic crisis and family-related characteristics, might play a moderating role. The main focus is to understand if new modes of becoming adult are emerging in a country in which leaving home occurs relatively late and where family ties are at the same time a source of protection and a source of reproduction of inequalities.

Design/methodology/approach

The paper uses longitudinal data from European Union Statistics on Income and Living Conditions for the period 2007–2014 and applies Event History Analysis techniques for discrete time data. The analyses estimate the hazard rate of leaving the parental home for a sample of Italian individuals in the age range of 16–40 who, at the beginning of the observation period, were living with their parents.

Findings

The empirical analyses highlight a negative association between exclusion from the labour market and housing autonomy, robust and consistent across gender and across types of transition. On the contrary, a situation of objective job insecurity does not emerge as being associated to lower chances of housing autonomy, compared to individuals with job stability. Moreover, the educational background of the family of origin does not show any mediating role on the relative disadvantage of unemployed and inactive individuals, while the relative disadvantage of inactive individuals tends to further worsen in the period after the economic crisis (2010–2014).

Originality/value

The paper contributes to the study of transitions to housing autonomy by differentiating between two modes: in couple or alone. Moreover, by introducing information on the educational background of parents and the time effect, the paper aims to combine different traditions of research coming from the sociology of work, family and inequalities.

Details

International Journal of Sociology and Social Policy, vol. 39 no. 7/8
Type: Research Article
ISSN: 0144-333X

Keywords

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